The Government has completed selling its £13bn book of former Northern Rock mortgages to US investment firm Cerberus Capital Management.
Cerberus made the final payment of £520m today, concluding the largest-ever financial asset sale by a European government.
The loan book, of around 125,000 customers, is part of NRAM – the state-owned remnant of Northern Rock. Around 240,000 mortgages will remain with NRAM.
This sale affects around 125,000 customers with mortgages and loans, out of a total of 367,000 people on UKAR’s books
The Government has today agreed to sell a portion of NRAM’s mortgages and loans to Cerberus for £13 billion. However, Cerberus in turn has sold £3.3 billion worth of these assets to TSB Bank.
The mortgages were originally owned by Northern Rock and were bought by the government during the financial crisis.
UK Asset Resolution, which manages the loans, then sold them to Cerberus.
A government statement says UK taxpayers will get back more from Northern Rock than was paid to bail them out during the financial crash.
Economic Secretary to the Treasury Harriett Baldwin says: “Today marks another major milestone in clearing up the mess left by the financial crisis, with the government completing the sale of former Northern Rock mortgages.
“Today’s receipt of the final funds from this sale mean that we now have even further confidence that taxpayers will get back more money from Northern Rock than they were forced to put in during the financial crisis.”